Question

Second-Hand Almost New Department Store Inc. is located near the shopping mall. At the end of the company's fiscal year on December 31, 2014, the following accounts appeared in two of its trial balances:

Analysis reveals the following additional information:
1. Insurance expense and utilities expense are 60% selling and 40% administrative.
2. In the next year, $20,000 of the mortgage payable will be due for payment.
3. Property tax expense and depreciation on the building are administrative expenses; depreciation on the equipment is a selling expense; $3 2,000 of the salaries and wages expense related to office salaries and the remainder related to sales salaries.
Instructions
(a) Prepare a multiple-step income statement, statement of retained earnings, and classified balance sheet.
(b) Journalize the adjusting entries that were made.
(c) Journalize the closing entries that are necessary.